Payday loan – 5 factors to consider

There are many payday loan package available in Singapore across licensed moneylenders to choose from, so where does one begin when looking for a payday loan? One of the best idea is to begin by understanding the payday loan process.

A payday loan is a short term loan with less stringent requirements than bank, long term loans. They are usually offered with no credit check, no upfront fees, and no down payment. In addition, in most cases, the loan money is available to you within 24 hours. However, before deciding whether to take out a payday loan you must be sure that you are capable of repaying the amount you intend to borrow.

The top 5 factors you should consider when looking for an payday loan offer bylegal moneylender are:

1.Loan Rates.Payday loan rates vary tremendously from company to company. While some payday loan companies will charge an affordable and flat rate of 15%, others may charge as high as 50%.

Avoid any payday loan company that does not clearly disclose their rates. If they are unwilling to disclose the loan rate amount to you until you are ready to commit to a loan agreement, beware! These are the companies that often charge hidden fees. When doing your research, keep a calculator nearby, so you can see the actual dollar amount you will be charged based on the loan amount you need.

2.Loan Terms.The terms of the loan should be considered before choosing a legal moneylender. Many payday loan companies require that you repay in full on your next pay date. Others may automatically extend your loan from pay date to pay date unless you indicate you want to pay the balance in full.

If you go with a company who operates using automatic extensions, you must factor in the additional fees that you will be required to pay if you do not pay in full on your original due date. Also consider the costs for companies that offer loan extensions on per request basis. You should know that even though it may be tempting to extend your loan due date, it may not always the smartest thing.

3.Rules & Regulations.Although the rules may vary from one licensed moneylender to the next, they are all governed The Insolvency and Public Trustee’s Office Singapore.

4.Trustworthiness.You should be leery of a payday loan company whose standards are too low. If a company has standards that are too loose it speaks to their trustworthiness. A company that will approve you without any documentation or at least some form of proof of your ability to repay the loan (i.e., a bank statement or a payslip) is not a very trustworthy company.

Like any lender, the moneylender company you choose should have certain guidelines and a verification process.

5.Customer Service.The customer service a company offers is of obvious importance. This is where you will be able to really narrow down your list of possible payday loan moneylender companies. When doing your research, call the companies and ask some questions.

The company you choose should be open, honest, willing to answer your questions, and happy to assist you. You should be pleased with the way you are treated by the company representatives and your ability to contact them, if needed. Beware of lenders that do not have a phone number where you can reach them.